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Important Changes Are Coming in 2017 to How Florida Regulates Treatment Providers

Written by:

at March 13, 2017

Good morning, SLN readers!

The Florida Legislative session kicked off last week (it runs for only 60 days), and there are two parallel bills (one in the House, one in the Senate) that specifically impact the delivery of treatment services to patients, and the methodologies to house them.

As Florida goes, so does the rest of the nation (on this topic, at least), so we thought it timely to give you an update as to where this issue currently stands (however, as with all legislation, matters are subject to change).

House Bill (HB) 807 currently entitled “Marketing Practices for Substance Abuse Services” and its counterpart, Senate Bill (SB) 788, implement several of the recommendations from the Palm Beach County Sober Home Task Force to address problems within the substance abuse treatment industry. Here is a “reader’s digest” version of what is currently being proposed:

1. Recovery Residence Referrals

  • The bill would expand prohibitions on referrals to and from recovery residences that do not obtain voluntary certification from DCF.
  • Licensed service providers would only be allowed to accept referrals from certified recovery residences. Current law is only limited in where providers could refer patients to; the bill expands this and limits from whom they may accept referrals.
  • After June 30, 2019, violators are subject to a $1,000 fine per occurrence.
  • The bill removes the exemption for referrals to a recovery residence that is “owned and operated” by a licensed service provider or its wholly owned subsidiary.

2. Patient Records

  • The bill creates a new provision for applications for disclosure of patient records for individuals receiving substance abuse services in an active criminal investigation, making Florida law parallel what is currently allowed for in 42 CFR pt. 2.
  • For criminal investigations, the court, at its discretion, will be able to enter an order authorizing the disclosure of an individual’s substance abuse treatment records without prior notice. Existing law would continue to apply to applications filed alone or as part of a pending civil investigation.

3. Marketing Prohibitions

(a) Deceptive Marketing

  • The bill expands the types of deceptive actions prohibited beyond those covered under the Florida Deceptive and Unfair Trade Practices Act (FDUTPA), and provides criminal penalties.
  • It provides a legislative finding that consumers of substance abuse treatment have disabling conditions and that such consumers and their families are vulnerable and at risk of being easily victimized by fraudulent marketing practices that adversely impact the delivery of health care.
  • Based on this finding, the bill prohibits a service provider, an operator of a recovery residence, or a third party who provides any form of advertising or marketing services to a service provider or an operator of a recovery residence from engaging in any of the following marketing practices:
    • Making a false or misleading statement or providing false or misleading information about the provider’s, operator’s, or third party’s products, goods, services, or geographical locations in its marketing, advertising materials, or media or on its website. This is a misdemeanor of the first degree.
    • Including on its website false information or electronic links, coding, or activation that provides false information or that surreptitiously directs the reader to another website. This would also be a misdemeanor of the first degree.
    • Conduct prohibited by the patient brokering statute, s. 817.505. F.S.
    • Entering into a contract with a marketing provider who agrees to generate referrals or leads for the placement of patients with a service provider or in a recovery residence through a call center or a web-based presence, unless certain specified information is disclosed to the prospective patient (such as who the call center represents so that there is transparency in the relationship). Violation of this section also would be a misdemeanor of the first degree.

(b) Fraudulent Marketing

  • The bill makes it unlawful for any person to knowingly and willfully make a materially false or misleading statement or provide false or misleading information about the identity, products, goods, services, or geographical location of a licensed service provider, as defined in chapter 397, F.S., in marketing, advertising materials, or other media or on a website with the intent to induce another person to seek treatment with that service provider. Such fraudulent marketing would be a felony of the third degree.

(c) Patient Brokering

  • The bill adds the term “benefit” to the list of items solicited or received that may not be used to induce the referral of a patient. The bill also adds patient brokering to the offenses that can be investigated and prosecuted by the Office of Statewide Prosecution and to the crimes that constitute “racketeering activities.”
  • The bill creates a $50,000 fine for patient brokering.
  • Additionally, the bill creates enhanced penalties for higher volumes of patient brokering.
    • For brokering of 10 to 19 patients, the crime is a second-degree felony and includes a $100,000 fine.
    • For brokering of 20 or more patients, the crime is a first-degree felony and includes a $500,000 fine.
    • The bill also adds patient brokering into the offense severity ranking chart; this will dictate the number of points that will be added to an offender’s scoresheet for sentencing purposes.

4. Substance Abuse Licensure

  • The bill makes a number of changes to DCF’s licensure of substance abuse treatment providers in chapter 397 to strengthen and improve the regulation of such providers, which are generally based on Florida’s Agency for Healthcare Administration’s (AHCA) statutory approach to licensure. The bill also addresses licensure issues identified by DCF.
  • The bill revises the licensure application requirements and process, requiring providers as part of the application to provide proof that they have obtained accreditation by the 2nd renewal.
  • Providers must also provide detail in the application about the clinical services they will provide.
  • DCF must set licensure fees to be sufficient to cover the cost of regulation.
  • The bill limits DCF to issuing only one probationary license per provider and only when doing so would not place the health, safety, or welfare or individuals at risk.
  • DCF is also prohibited from issuing a license if staff do not pass background screenings and subsequently fail to obtain exemptions.
  • The bill increases penalties for operating without a license, making it a third-degree felony.
  • The bill creates s. 397.410, F.S., which requires DCF to have drafted rules for minimum standards for licensure by January 1, 2018, that address: Administrative management; Standards for clinical and treatment best practices; Qualifications of all personnel, including staffing ratios; and Service provider facility standards.
  • The bill authorizes DCF to inspect providers on announced or unannounced basis to see if minimum requirements are met and grants DCF more flexibility in scheduling inspections.
  • The bill also expands DCF’s authority to take action against a service provider. It requires DCF to use a tier-based system of classifying violations and issuing fines or requiring other action. It allows for each day a violation occurs to be considered a separate violation.
  • The bill authorizes use of corrective action plans; allows moratoria or immediate license suspensions for client health, safety or welfare; requires visible posting of notice of a moratorium or suspension; and allows DCF to deny, suspend, or revoke a license due to: False representation; An act affecting client health or safety; A violation of statute or rule; A demonstrated pattern of deficient performance; or Failure to remove personnel failing background screening.

The bill provides an effective date of July 1, 2017.
We will continue to monitor these important bills in the Florida Legislature and provide updates as they come up.

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